AT&T Inc.'s WarnerMedia will start a new streaming service for consumers next year, challenging Netflix Inc. and a planned product from Walt Disney Co.

The service will be anchored by HBO as lead brand and will host WarnerMedia's vast library of movies, TV shows, documentaries and animation. WarnerMedia CEO John Stankey described the new service during an on-stage interview Wednesday at Vanity Fair's New Establishment Summit in Los Angeles.

Media companies are scrambling to offer more direct services in response to consumers cutting their cable subscriptions. Dallas-based AT&T's move is a result of its nearly $109 billion purchase of Time Warner earlier this year.

"Around HBO will come a great library of additional content from not only the WarnerMedia properties but also some selective third-party licensed content," Stankey said. "And the driver behind this is really straightforward. We know there's customers who love to engage with our content — we've got a great history of building it — much of which they can't get in one place."

John Stankey, CEO of WarnerMedia, (left) was interviewed by Anderson Cooper on Sept. 27 during the AT&T Business Summit at the Gaylord Texan Resort & Convention Center in Grapevine.

(Nathan Hunsinger/Staff Photographer)

AT&T also owns DirecTV and has expanded its advertising and media capabilities since closing the Time Warner deal. It already offers some streaming services, including DirecTV Now as a cable replacement. HBO Go is a streaming version of HBO that requires a cable login. HBO Now is a standalone streaming service for HBO content.

AT&T also has launched a $7.99-a-month streaming service focused on its DC Comics content.

Stankey said the new streaming service will come at a "compelling price point." Streaming is becoming a crowded field with options such as Netflix, Hulu, HBO Now, CBS All Access, Showtime, Amazon, YouTube Premium and others.

AT&T chief executive officer Randall Stephenson telegraphed the move last month at an investor road show in New York.